Originally Posted by
arjay
The Tui field was developed on the basis that $40 per barrel would make it profitable. Oil is now approaching $100 per barrel, however the NZO SP is dropping (down 1c as I write) in part because none of the current windfall is flowing back to the shareholder. What I believe should happen is for NZO to determine a price per barrel that makes Tui profitable and pays back loans etc in a timely fashion. This would be abov ethe original $40 due to associated extra costs. HOwever, let's say this value is $60 (for argument sake). Anything above that value could then be deemed a windfall and distributed to shareholders. The effect of doing this would be to stimulate interest in NZO stock while oil prices remain high while also quickly paying back debt. High oil prices should continue into the medium term at so this should also see the options converted. I see this as being win-win all round with return to shareholders, extra funds flowing in next July, and the Directors will still be able to ask for increased fees again at the next AGM.